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Fairfax 2024


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2 hours ago, mananainvesting said:

What are the likely scenarios on FFH closing the TRS? Would they have to pay the financial institutions to close the position? Can Fairfax buy the shares underlying the TRS? 

1. Forced index buying is my bet

2. No, just not renew. However, when the contract closes, unless the bank wants to keep the position, they will sell it into the market. Unless there is an additional source of demand, this could put downward pressure on the share price, so in the month the contract ends, this could be quite costly to Fairfax. There is also the real possibility that a lot of investors are using the TRS as a proxy on IV and may choose to exit as well. Leverage works both ways. I would see this as a short term blip, but the market can react in pretty funky ways at time

3. Yes, but remember that this could be seen as a significant funding source for the buybacks to date. 

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51 minutes ago, nwoodman said:

1. Forced index buying is my bet

2. No, just not renew. However, when the contract closes, unless the bank wants to keep the position, they will sell it into the market. Unless there is an additional source of demand, this could put downward pressure on the share price, so in the month the contract ends, this could be quite costly to Fairfax. There is also the real possibility that a lot of investors are using the TRS as a proxy on IV and may choose to exit as well. Leverage works both ways. I would see this as a short term blip, but the market can react in pretty funky ways at time

3. Yes, but remember that this could be seen as a significant funding source for the buybacks to date. 

 

In the event of Fairfax being added to the index, I wonder if the bank will keep many of the share for their own index or mutual funds.

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3 hours ago, Hoodlum said:

 

In the event of Fairfax being added to the index, I wonder if the bank will keep many of the share for their own index or mutual funds.

Inventory trading may well be a consideration,  it would take some of the pressure off.  You just know that Fairfax will have some angle that will be enlightening 👍

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13 hours ago, mananainvesting said:

What are the likely scenarios on FFH closing the TRS? Would they have to pay the financial institutions to close the position? Can Fairfax buy the shares underlying the TRS? 


1. When they have the cash to buyback the shares. My guess is when they sell some Digit. Likely years away.

 

2. They don’t have to but it’s nice to be able to buyback shares at market without paying a premium.

 

3. No reason why not.

 

Many investors are afraid of a decline in earnings from the TRS in a given quarter but from a liquidity perspective it’s a pretty low risk. The stock would have to fall more than $500/sh to approach how much FFH makes in an average quarter. It’s a risk they can easily handle. 

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On 11/7/2024 at 8:00 AM, SafetyinNumbers said:

Thanks @mananainvesting and @Viking! Viking I’m looking forward to what you come up with. I find your analysis extremely helpful!

 

@Haryana I think that makes sense on the performance fees but it’s hard to believe the discount closes entirely except if investors really want to own BIAL post IPO. 

 

You have a great podcast voice too.

 

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1 hour ago, PJM said:

Sorry to digress from the topic, does anyone know the tentative dates of Fairfax annual meeting in 2025 and related events. No announcement available on the website. Thanks


The Ben Graham Value Investing Conference (featuring Adam Waterous from Strathcona) is on April 8 so fair to assume Fairfax India AGM is on the 9th and Fairfax AGM is on the 10th.

 

https://www.ivey.uwo.ca/bengrahaminvesting/bgcvi-events/2025/04/2025-value-investing-conference/?utm_source=google&utm_medium=cpc&utm_term=&adpos=&gad_source=1&gbraid=0AAAAADvlxZdoVkuwEueSz6nVuNiFwIFLA&gclid=Cj0KCQiAlsy5BhDeARIsABRc6Zumbx_bDO6NwxclCd6RjwJ3HpXy-2KvnoA8_CZtX8dn3cq6AQTg6AUaAiEAEALw_wcB

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21 minutes ago, Dinar said:

Renaissance Re on its conference call on November 7th: strong markets and rates are here to stay.

 

That's impressive they know the future.  Super valuable skill to have

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3 hours ago, Hoodlum said:

It will be interesting to see if that position changes during the next 6 months.

 

What makes you think the market is finally softening? 

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